Adelphi University to spend $55 million on Garden City campus upgrades

Adelphi University will borrow nearly $55 million to pay for a range of upgrades to its Garden City campus and is authorized to borrow up to another $70 million to refinance old debt.

The university will borrow $54.3 million in tax-exempt bonds for upgrades, including buying a new computer system and installing new heating and cooling systems at some of its buildings, said Christopher Storm, Adelphi’s interim president.

The Town of Hempstead Local Development Corp. unanimously approved up to $125 million in tax-exempt bonds on Jan. 27 for campus upgrades and to refinance past debt.

Adelphi may use some of those bonds to refinance $56.9 million in bonds issued between 2013 and 2014, if it can negotiate a lower interest rate, Michael Rhattigan, Adelphi’s vice president of finance and chief financial officer said.

The four-year, $55 million project to upgrade the 75-acre Garden City campus will begin by March and work will be done mostly during the summer and winter months when students are on break, Storm said.

“This is something that will really affect every student,” Storm said.

Universities commonly use tax-exempt bonds to fund various projects, said Howard Cure, the director of municipal bond research for Evercore Wealth Management, an investment adviser. Hofstra University also has refinanced old bonds with new debt. 

The new debt comes as Adelphi, a private university founded in the late 1800s in Brooklyn, expands its footprint into Manhattan after it saw a dip in enrollment and the abrupt departure of its former president in June.

Adelphi will open a new 51,000-square-foot building at 529 Fifth Ave. in midtown in the summer, focused on professional programs like nursing, Storm said.

“In terms of academic growth and direction, that's a big initiative for us,” Storm said.

But Mark Grabowski, professor of communications at the university, questioned whether the bonds were a good investment.

“Our facilities need updating — classrooms and labs are outdated,” Grabowski said. “But the strategic question is whether taking on tens of millions in debt makes sense given the well-documented demographic realities facing higher education in 2026 and beyond.”

The university had $93.2 million outstanding bonds and bank loans as of Dec. 31, 2025, Rhattigan said.

New and old debts

Refinancing old bonds with new bonds is a good strategy if the university can secure lower interest rates, saving money in the long run, Cure said.

But the amount of new debt pushed S&P Global Ratings to downgrade Adelphi’s credit rating from an A- to a BBB+ on Jan. 30, said Vicky Stavropoulos, a senior analyst at S&P, which evaluates the creditworthiness of debt issuers.

A downgrade indicates to investors that there’s a higher risk in buying these bonds, given the university’s tight budget, relatively small endowment and competition from cheaper, state universities, Cure said.

Adelphi had a roughly $5 million deficit in the 2024 fiscal year, but had a $245,876 surplus in 2025, Rhattigan said.

As Adelphi looks to expand its programs into Manhattan, Cure said recruiting and retaining students would be crucial to its success.

“They have to be proactive in making sure they’re a competitive institution," Cure said.

Dallas-based Hilltop Securities will underwrite Adelphi's loans. In a bond transaction, an underwriter agrees to buy the debt and then sells the bonds to investors, Cure said. Adelphi then has to pay back the money those investors over time.

A spokesperson for Hilltop Securities declined to comment.

Student enrollment decline

The new debt was not a factor in Adelphi's decision to raise tuition to $50,110 for the 2025-2026 academic year, Storm said. The university usually increases tuition every year, Rhattigan added.

Adelphi's expansion into Manhattan could help increase its enrollment. The number of full-time students at Adelphi fell 5%, to 6,037, in the 2025-2026 school year compared with the year before, according to data from the New York State Department of Education.

Adelphi’s matriculation rate — the share of students who decide to attend — also declined to 8.2% in the 2025-2026 school year from 10.3% the year before, according to S&P's report.

Nationally, universities are likely to face enrollment declines in the next 15 years because of a fewer number of college-aged students, said Nathan Ross, an assistant teaching professor at Adelphi. 

Planned improvements

Among the university’s upgrades are a new cooling system to its science building, administrative building and Hagedorn Hall of Enterprise, which holds the majority of classes at the university, Storm said. The fourth floors of five of the university's residence halls — Chapman Hall, Earle Hall, Eddy Hall, Linen Hall and Waldo Hall — will also get new air conditioning systems.

Those changes are badly needed, said Laura Kastrati, 19, an Adelphi student graduating in 2028. 

“One building will be so hot and another will be so cold,” Kastrati said Monday. “We pay way too much money to go to this school for the things that we get out of it.”

The university will also replace the turf on one of its athletic fields, Storm said. Plus, it secured a $1.7 million gift to purchase new equipment and fund maintenance at its performing arts center.

Correction: A previous version of this story incorrectly stated Adelphi's original credit rating. It was downgraded from A- to BBB+.